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Note 11 - Income Taxes and Deferred Tax Asset/Liability | 12 Months Ended
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Dec. 31, 2012
Income Tax Disclosure [Text Block] |
11. | Income Taxes and Deferred Tax Asset/Liability
The Company and its subsidiaries file U.S. federal and various U.S. state income tax returns. The Company’s 2007 through 2009 U.S. federal income tax returns have been examined by the I.R.S. Based on their examination, $314,000 was calculated as additional tax owed. The Company’s policy is to recognize interest related to any underpayment of taxes as interest expense, and penalties as administrative expenses. No interest or penalties have been accrued at December 31, 2012, and interest and penalties for the years ended December 31, 2011 and 2010 were not significant. The Company’s U.S. federal income tax returns for 2010 and later years are open and subject to examination by the I.R.S. Current income tax expense represents federal and state income tax paid or expected to be payable for the years shown in the statements of operations. The income tax expense (benefit) in the accompanying consolidated financial statements consists of the following (in thousands):
|  | Years Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
Current tax expense (benefit) |  | $ | 588 |  |  | $ | 1,639 |  |  | $ | 6,410 |
Deferred tax expense (benefit) |  |  | (1,167 | ) |  |  | (18,651 | ) |  |  | 3,860 |
Total tax expense (benefit) |  | $ | (579 | ) |  | $ | (17,012 | ) |  | $ | 10,270 |
Deferred tax assets and liabilities consist of the following (in thousands):
|  | As of December 31, |
|  | 2012 |  |  | 2011 |
|  | Current |  |  | Long Term |  |  | Current |  |  | Long Term |
Assets related to: |  |  |  |  |  |  |  |  |  |  |  |
Accrued compensation and other |  | $ | 1,803 |  |  | $ | -- |  |  | $ | 1,302 |  |  | $ | -- |
Amortization and impairment of goodwill |  |  | -- |  |  |  | 13,181 |  |  |  | -- |  |  |  | 15,900 |
Accreted interest to put |  |  | -- |  |  |  | 939 |  |  |  | -- |  |  |  | 587 |
Contingency on lawsuit |  |  | -- |  |  |  | 130 |  |  |  | -- |  |  |  | 391 |
Noncontrolling interest |  |  | -- |  |  |  | 915 |  |  |  | -- |  |  |  | -- |
Revaluation of put/call liabilities |  |  | -- |  |  |  | 2,194 |  |  |  | -- |  |  |  | -- |
Liabilities related to: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Depreciation of property and equipment |  |  | -- |  |  |  | (13,615 | ) |  |  | -- |  |  |  | (14,040 | )
Noncontrolling interest |  |  | -- |  |  |  | -- |  |  |  | -- |  |  |  | (1,720 | )
Other |  |  | -- |  |  |  | (771 | ) |  |  | -- |  |  |  | (290 | )
Net asset (liability) |  | $ | 1,803 |  |  | $ | 2,973 |  |  | $ | 1,302 |  |  | $ | 828 |
The Company expects that the deferred tax asset will be realized and accordingly no valuation allowance is necessary. During 2012, we recorded a long-term deferred tax liability of $360,000 on depreciable property as a result of a business combination. Refer to Note 2 for a description of the business combination. The income tax provision (benefit) differs from the amount using the statutory federal income tax rate of 35% for the following reasons (amounts in thousands):
|  | Years Ended December 31, |
|  | 2012 |  |  | 2011 |  |  | 2010 |
|  | Amount |  |  | % |  |  | Amount |  |  | % |  |  | Amount |  |  | % |
Tax expense (benefit) at the U.S. federal statutory rate |  | $ | 5,997 |  |  |  | 35.0 | % |  | $ | (18,101 | ) |  |  | 35.0 | % |  | $ | 12,773 |  |  |  | 35.0 | %
State tax based on income, net of refunds and federal benefits |  |  | (58 | ) |  |  | (0.3 | ) |  |  | (573 | ) |  |  | 1.1 |  |  |  | 879 |  |  |  | 2.4 |
Taxes on subsidiaries’ and joint ventures’ earnings allocated to noncontrolling interests owners |  |  | (5,938 | ) |  |  | (34.7 | ) |  |  | (444 | ) |  |  | 0.9 |  |  |  | (2,498 | ) |  |  | (6.8 | )
Tax benefits of Domestic Production Activities Deduction |  |  | (84 | ) |  |  | (0.5 | ) |  |  | (202 | ) |  |  | 0.4 |  |  |  | (500 | ) |  |  | (1.4 | )
Impairment associated with goodwill that is not amortizable for tax |  |  | -- |  |  |  | -- |  |  |  | 2,603 |  |  |  | (5.0 | ) |  |  | -- |  |  |  | -- |
Non-taxable interest income |  |  | (529 | ) |  |  | (3.1 | ) |  |  | (376 | ) |  |  | 0.7 |  |  |  | (494 | ) |  |  | (1.4 | )
Other permanent differences |  |  | 33 |  |  |  | 0.2 |  |  |  | 81 |  |  |  | (0.2 | ) |  |  | 110 |  |  |  | 0.3 |
Income tax expense (benefit) |  | $ | (579 | ) |  |  | (3.4 | )% |  | $ | (17,012 | ) |  |  | 32.9 | % |  | $ | 10,270 |  |  |  | 28.1 | %
As a result of the Company’s analysis, management has determined that the Company does not have any material uncertain tax positions.

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